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Who has to file a trust return

  • 1.  Who has to file a trust return

    Posted 03-22-2019 11:04
    I have a client who started a third party special needs trust for his daughter. There was $200 in dividend income. Do they have to file 1041?

    The IRS instructions are ​the fiduciary (or one of the joint fiduciaries) must file Form 1041 for a domestic trust taxable under section
    641 that has:
    1. Any taxable income for the tax year,
    2. Gross income of $600 or more (regardless of taxable income), or
    3. A beneficiary who is a nonresident alien.

    Am I interpreting correctly that if any of the 3 conditions are met, a trust return must be filed?

    Thanks in advance!

    Eileen Dunn CPA
    Islandia NY

  • 2.  RE: Who has to file a trust return

    Posted 03-25-2019 14:21
    ​The trust return should be filed, however, I recommend the trust document be reviewed to determine if the trust is a grantor trust which can result in the grantor(s) reporting the income on their 1040.

    Frank Sands
    Plano TX